For governor titles, I look for decent acumen (3+) and maybe some dread. A good general with middling loyalty (3-4 range) can be a good choice as well. Some titles give dread, acumen, and command, I try to match the bonuses up with what I have.
Supposedly, if you give titles to non-nobles, the overall loyalty of your noble generals will drop. Noble generals are the ones with the "Sir" (or other faction specific) prefix in the name. I'm not 100% sure on this though, and I don't know the actual penalty. It doesn't really matter early on in the game, it might become a bigger deal later. If you roleplay your empire, some people limit themselves to only giving titles to nobles.
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